|
PureBytes Links
Trading Reference Links
|
Stuart:
Actually, in situations like this, the Fed has a great tool--they call the
main players at major money center banks and tell them to loan
aggressively. It isn't a tool they use often, but when they do call, the
major players listen, because the tool can work both ways. You may need the
Fed to help you on a short reserve day or with a major problem, so it pays
to listen, especially because all of your peers will be getting the same
call and the same cheap money.
That doesn't mean the Fed will have an easy time of it. They know they are
pushing a wet noodle. It just means that they will use tactics they
normally wouldn't take out of their tool box.
Best,
Tim Morge
Blackthorne Capital
At 11:14 PM 10/1/2001 -0400, you wrote:
>Bruce
>Does that mean money is tight now in the USA because comercial and industrial
>loans are crashing along with commercial paper.
>Stuart
>
>bruce.larson@xxxxxxxxxxxxx wrote:
>
> > The Fed injects liquidity by buying back mainly short treasuries. So
> > now the banks are sitting on alot of cash. The only way this is
> > distributed through the system is if the banks are willing to lend
> > this excess cash out and if borrowers see leveraged investment
> > possibilites. Japan loosened in the 90s but it didn't do the
> > domestic economy any good because domestic borrowers were perceived
> > uncreditworthy. I'm sure the borrowers and investors were already
> > drowning in a tide of debt and stock market losses. Initally the
> > liquidity went offshore to Southeast Asian ventures which pretty much
> > all bit the dust. Now all the money is parked in long Japanese
> > government bonds which last time I looked yielded about 1.4%. Who in
> > their right mind would buy long-term debt in the world's most
> > indebted nation suffering through a severe recession and doing
> > everything it can to weaken its own currency? Better off putting
> > your money under a mattress.
> >
> > --- In realtraders@xxxx, profitok <profitok@xxxx> wrote:
> > > Hello
> > > Attach is the latest m3 money supply as reported by the fed
> > > ----- Original Message -----
> > > From: "STUART AUSLANDER" <u.stuart-auslander@xxxx>
> > > To: <realtraders@xxxx>
> > > Sent: Monday, October 01, 2001 10:05 PM
> > > Subject: [RT] Adjusted Reserves Sept 19, 2001
> > >
> > >
> > > > Adjusted reserves of the banking system which have varied from 60
> > to 70
> > > > billion for the last 3 years(except during Y2K) grew from 68 bil
> > on
> > > > September 5 to 107
> > > > billion on September 19. (These are the Fed StLouis measures of
> > the
> > > > required reserves need by the banking system to support their
> > > > deposits.) I would say the FED has taken out all the stops and
> > intends
> > > > to dramatically stimulate the economy with money.
> > > >
> > > > It is my feeling (I would love feedback on this) that money has
> > been
> > > > tight despite declining interest rates. Declining interest rates
> > do not
> > > > necessarily make money loose. I suspect we have just seen a major
> > > > change in FED policy.
> > > >
> > > >
> > > > To unsubscribe from this group, send an email to:
> > > > realtraders-unsubscribe@xxxx
> > > >
> > > >
> > > >
> > > > Your use of Yahoo! Groups is subject to
> > http://docs.yahoo.com/info/terms/
> > > >
> > > >
> >
> >
> > To unsubscribe from this group, send an email to:
> > realtraders-unsubscribe@xxxxxxxxxxxxxxx
> >
> >
> >
> > Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
>
>
>
>To unsubscribe from this group, send an email to:
>realtraders-unsubscribe@xxxxxxxxxxxxxxx
>
>
>
>Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
------------------------ Yahoo! Groups Sponsor ---------------------~-->
FREE COLLEGE MONEY
CLICK HERE to search
600,000 scholarships!
http://us.click.yahoo.com/Pv4pGD/4m7CAA/ySSFAA/zMEolB/TM
---------------------------------------------------------------------~->
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxxxxxx
Your use of Yahoo! Groups is subject to http://docs.yahoo.com/info/terms/
|